Print 6 comment(s) - last by Paj.. on Oct 10 at 7:45 AM

Sony Ericsson Xperia Play
Deal could be worth $1.3 billion to Ericsson says analyst

In the smartphone world, there are several players out there and many of them are banking on the popularity of Google’s Android operating system for continued success. Sony Ericsson was one of the firms that came later to the Android game.

Reuters reports that Sony is in talks to buy out the Ericsson stake in the mobile phone company. That would mean the smartphones would be solely under the Sony brand. Considering one of the more interesting smartphones to come out of the partnership between the two firms was the Xperia Play that is heavily focused on gaming, it's not surprising that Sony want the devices under its own brand.

Right now, Sony makes tablets, music players, and computers under its name and the only products offered under the Sony-Ericsson brand are mobile phones. According to Reuters, the negotiations with Sony and Ericsson have been ongoing for weeks. The Sony Ericsson brand is a 50:50 joint venture and the decade-long deal that started the venture must be reapproved this month.

A source close to the deal that Sony was talking buyout as of Friday. The deal could net Ericsson $1.3 billion depending on what the telecom patents Ericsson holds and uses in the smartphones are worth according to analyst Yoshiharu Izumi of J.P. Morgan in Tokyo.

Izumi said, "Up to now Sony's products and network services have all been separate. Unifying them would be positive. If they can leverage their games and other network services I think they can lift their share."

The Sony Ericsson venture has reportedly turned a profit of 90 million euros as of last year after a massive loss of 836 million euros in 2009. However, its share of the cell phone market has dropped from fourth place to 9th place in only a few years time.

Source: Reuters

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

By Booster on 10/8/2011 3:54:24 AM , Rating: 2
Been using SE phones for years now and all I can say most of them were utter half-assed made junk. But a few like C901 were quite good. Now I have SE Neo which is fine but the camera blows. Doubt Sony would make better devices by itself though.

RE: Sceptic
By retrospooty on 10/9/2011 10:29:37 AM , Rating: 2
"Been using SE phones for years now and all I can say most of them were utter half-assed made junk"

So why do you keep buying them?

RE: Sceptic
By Booster on 10/9/2011 2:17:31 PM , Rating: 2
Lack of options. In my parts SE has long was been offering the best price/quality ratio. I personally can't stand Nokia and Samsung as far as feature phones go. So for me for the longest time SE was the best choice for 'regular' phones. But not all of their models were good, sometimes you'd get a lemon. As far as smartphones go, I dare you find a better equipped Android than SE Neo for it's price (at least on paper. As it turns out it's camera is lackluster).

Just in time.
By drycrust3 on 10/7/2011 3:24:16 PM , Rating: 2
Sony Ericsson was one of the firms that came later to the Android game.

I think it's becoming pretty clear now that you need to have both smartphones and tablets to survive as a mobile phone producer or as a large scale producer of consumer computing devices, and that the divide between being computer manufacturer and mobile phone manufacturer has closed.
The duel corporate relationship between Sony and Ericsson would have made it difficult to respond quickly to the needs of the market, which maybe one reason that my local electronics store has just two Sony Ericsson smartphones and no tablets for sale. Compare that to Apple who have 12 different iPads for sale in the same store.
It was recently estimated that in just 4 years time half the people (world wide) that regularly access the internet will do it via a mobile device, which means there are hundreds of millions of devices going to be sold, and to be part of that you need to have both tablets and smartphones, and you need to be able to have a wide range of products.
My guess is Sony will be desperately wanting to get tablets into the market, but that even though both Sony and Ericsson each own 50% of there company, Sony is the company carrying the weight of their mobile products. Having to wait for Ericsson to approve the sale of every new product would rankle at Sony.
Nokia are having to lay off staff because of lack of sales, and it wouldn't surprise me if a lack of sales has also affected Sony-Ericsson, and if so then that would be another motivating factor behind the buyout.
All in all, I think this is a good move for Sony.

Smart move
By sleepeeg3 on 10/7/2011 6:27:48 PM , Rating: 2
Good move, by Sony. Unifying the brand under their own name and giving themselves more control over the future should make them more competitive. Their recent phones have been solid against the likes of Apple and Samsung. Fully integrating their PSP into new phones would give them a huge advantage over their competitors. Gaining new subscribers at a young age through Playstation games vs the dinky apps that we have now could also help leverage their brand name into the future adult market. The Xperia Play is just a limited overpriced, nice idea right now, but it has potential.

By Paj on 10/10/2011 7:45:55 AM , Rating: 2
The Ericsson brand is pretty dead now. They were leaders in the era of Symbian dominance but that era is well and truly over. I think many associate Ericsson with the past now and tey have very little traction in the world of Apple and Android.

Sony came up with a good idea with the Xperia Play, shame it was underpowered. The PSP as it stands is on its last legs - sure they games are deeper, but the hardware is more expensive and less capable. What they should do is incorporate a phone into the next PSP and offer it as a premium gaming phone.

"Let's face it, we're not changing the world. We're building a product that helps people buy more crap - and watch porn." -- Seagate CEO Bill Watkins
Related Articles

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki